Kolkata-based Petro Carbon and Chemicals Ltd. has launched its initial public offering (IPO), which opened for subscription on Tuesday, June 25.
The company aims to raise approximately ₹113.16 crore through this SME public offering. Here’s a detailed breakdown of the IPO and its key elements.
Overview of the Petro Carbon and Chemicals IPO
Petro Carbon and Chemicals Ltd., a part of the Atha Group, is a prominent producer and seller of calcined petroleum coke (CPC) in the carbon industry.
The company has a strong B2B business model, supplying CPC to aluminum manufacturers, graphite electrode producers, titanium dioxide manufacturers, and other industries.
The IPO is expected to provide insights into the company’s growth prospects and financial health.
IPO Subscription Details
On the first day of the IPO, according to exchange data, Petro Carbon and Chemicals’ offering was subscribed to around 36% by 12 PM.
A total of 15,93,600 equity shares were bid for out of the 43,32,000 shares available for public subscription by noon.
The retail portion saw a subscription rate of approximately 33.43%, with 8,53,600 shares bid for. Non-institutional investors (NIIs) showed a 71% subscription rate, receiving applications for 7,10,400 shares out of the 9,28,800 on offer.
However, no bids had been received from qualified institutional buyers (QIBs) on the first day.
Anchor Investors and Allotment
Before the IPO opening, the company successfully raised around ₹31.72 crore from anchor investors on Monday by allotting 18,55,200 shares at a price of ₹171 per share.
This anchor investment highlights the confidence of major investors in the company’s potential.
IPO Timeline
The IPO opened for subscription on June 25 (Tuesday) and will close on June 27 (Thursday) on the NSE SME platform.
The share allotment status is expected to be announced on June 28 (Friday).
Subsequently, the company plans to release refunds and initiate credit of shares to demat accounts on July 1. The shares are set to be listed on the NSE’s SME platform on July 2.
Financials and Offer Details
Pricing and Investment
The Petro Carbon and Chemicals IPO is priced between ₹162 and ₹171 per share. For retail investors, the minimum lot size is 800 shares, translating to a minimum investment amount of ₹136,800.
Offer for Sale (OFS)
This IPO is an entire Offer for Sale (OFS) issue, where existing shareholders Kishor Kumar Atha, Dilip Kumar Atha, Gaurav Atha, Vishal Atha, and Bharat Atha are offering 13,23,520 shares each.
The proceeds from this IPO will go directly to these selling shareholders, and the company will not receive any portion of the funds raised.
Share Allocation
The public offer of ₹113.16 crore involves the sale of 66.18 lakh shares by existing shareholders.
The company has allocated 12,36,800 shares for qualified institutional buyers (QIBs), 9,28,800 shares for non-institutional investors, and 21,66,400 shares for retail investors.
Company Profile and Business Model
Petro Carbon and Chemicals Ltd. is an integral part of the Atha Group, based in Kolkata. The company’s primary product, calcined petroleum coke (CPC), plays a crucial role in the carbon industry.
CPC is used extensively by aluminum manufacturing companies, graphite electrode producers, and titanium dioxide manufacturers.
Additionally, it serves various other industries, including metallurgical, chemical, and steel manufacturing sectors.
Financial Performance
For the April-December period of the fiscal year 2023-24, Petro Carbon and Chemicals reported a total income of ₹447 crore.
The company’s total income for the fiscal year 2022-23 was ₹518 crore, a significant increase from ₹280 crore in the previous year. This financial growth reflects the company’s robust performance and market presence.
Strategic Insights
Market Position
Petro Carbon and Chemicals has established itself as a key player in the carbon industry, thanks to its strong B2B business model.
The company’s ability to supply high-quality CPC to major industries underscores its competitive advantage and market positioning.
Growth Potential
The funds raised through the IPO, albeit directed to existing shareholders, highlight the market’s confidence in the company’s future growth.
The anchor investment prior to the IPO also signals strong investor interest and belief in the company’s potential.
Industry Dynamics
The carbon industry is crucial for various sectors, including aluminum production, graphite electrode manufacturing, and titanium dioxide production.
Petro Carbon and Chemicals’ strategic focus on these sectors positions it well to capitalize on industry trends and demands.
Conclusion
The Petro Carbon and Chemicals IPO presents a significant opportunity for investors to partake in the growth of a leading player in the carbon industry.
With a strong financial track record, strategic market positioning, and robust business model, the company is poised for continued success.
As the IPO progresses, investors will closely watch the subscription rates and market response, providing further insights into the company’s market potential.
Investors interested in the Petro Carbon and Chemicals IPO should carefully consider the subscription details, pricing, and financial performance of the company.
The IPO’s success will not only benefit the selling shareholders but also affirm the company’s market strength and future growth prospects.